How Empathetic Claim Management Helps Avoid Large Jury Awards and Nuclear Verdicts
White Paper Summary
The trends of social inflation and nuclear verdicts are well-known in the insurance industry. Nuclear verdicts are defined as judgments amounting to more than $10 million, though the ceiling keeps rising. Just a few months ago, a jury handed down a $411 million verdict against a trucking company after a jack-knifed tractor trailer caused a multi-vehicle pileup that severely injured the plaintiff.
The commercial transportation sector has long been a popular target of costly liability litigation.
According to data from the American Transportation Research Institute, the average verdict size for lawsuits above $1 million involving a truck crash increased from $2.3 million to $22.3 million between 2010 and 2018 — a nearly 1,000% jump.
“There seems to be an inherent prejudice among the general public against big trucks. Plaintiffs’ attorneys are driving this attitude that if you’ve been involved in an accident with a truck, you deserve to be paid regardless of fault,” said Don Payne, Vice President, Eastern Region, at Crawford &Company, and Managing Director of Crawford’s U.S. Commercial Transportation Unit.
“For that reason, I don’t think nuclear verdicts are going to stop anytime soon. But there are ways for companies to mitigate their exposure.”
In transportation and many other industries, the impact of biases against businesses can work against employers. A little bit of compassion goes a long way in combatting the anger and fear driving litigation. Claims organizations can avoid litigation and achieve quicker, less costly settlements when they take an advocacy-based approach that prioritizes care for injured parties.
Here are three critical components of an advocacy-based model that minimizes the risk of nuclear verdicts:
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